It is important, however, for us to recognise that the world of aviation has changed significantly over the years.

While the airline industry continues to be capital-intensive with very high, fixed costs, competition among airlines for market share has become extremely fierce, especially with the emergence of the low-cost airline.

These factors, together with a recently contracting world economic climate, have made business for Air Jamaica very tough.

Accumulated losses

Over the past 10 years, our national carrier has seen accumulated losses of well over US$1 billion or approximately J$88.5 billion.

For perspective, those accumulated losses represent approximately 25 per cent of total fiscal expenditure for the current year - valuable resources that could be used to improve health care, education and social safety nets.

In order to survive in this difficult economic climate, Air Jamaica must refocus its efforts and optimise its resources to markets where it can have a competitive advantage.

In simple terms, the company must eliminate its substantial operating losses and concentrate on becoming a profitable airline by optimising its strengths.

Major restructuring

The Government, therefore, has two major tasks:

As set out by the current business plan, a major restructuring of Air Jamaica is in progress. These are early days, but the exercise has already produced some excellent results.

Since the beginning of this month, the airline's overall load factor has increased by 11 percentage points compared to the same period last year.

Speaking specifically to the South Florida market, Air Jamaica has reduced costs while retaining the majority of the traffic, which it previously carried from both the Miami and Fort Lauderdale gateways. This has led to a 21 percentage point increase in the load factor for that route.

The next steps in the process include reducing Air Jamaica's fleet, which will occur over the next 60 to 90 days. Over that same period, the airline will also evaluate what additional changes in the carrier's staff complement might be necessary after the voluntary separation exercise, currently under way, is completed.

The airline continues to work with the unions to mitigate the impact on employees. Air Jamaica's management has also involved the airline workers in the search for solutions to the financial and operational dilemmas that the airline faces. This is being done through different employee working groups as well as weekly consultations with a joint management/union steering committee.

While the business plan has led us forward with these improvements thus far, it does not address the massive loan principal of US$652 million, amassed over a number of years. This has been a significant burden on the Government and people of Jamaica and has had a debilitating effect on the operations.

It is all the more urgent, therefore, for the fortunes of the airline to be reversed as quickly as possible, as the Government and people cannot afford for that debt to continue growing.

This has been one of the key drivers behind the urgency with which the Government has been seeking a major international airline partner who would be willing to commit the necessary resources to ensure that the national airline is properly funded and that it also operates and grows in the most efficient manner. This is more than the airline can have under government control.

Opportunity to thrive

I see the divestment as an important opportunity for Air Jamaica to thrive, as it will bring the capital and the expertise needed to beat the challenges outlined above. It is our goal that, at the end of the privatisation process, Jamaicans and visitors will have access to superior and convenient air travel.

As we are now at an advanced stage of the divestment process, the total number of potential investors - that is, qualified bidders who continue to show significant interest - remains at three. The discussions, thus far, have been fruitful and the parties have committed to submitting formal proposals to the divestment team.

The divestment committee remains confident that it can complete this task within a short time. Our original deadline of March 31 is drawing closer and, while we do not foresee ourselves finalising a deal with an investor by then, we are satisfied with the progress being made and are heartened by the fact that we have already received an initial proposal from one prospective investor.

That proposal specifies terms they would agree to with the Government and we are engaged in ongoing negotiations with them.

We remain cognisant of the fact that the privatisation of Air Jamaica is a sensitive issue, but as responsible stewards, the Government often has to make difficult decisions to secure the well-being of its people and, in this case, to ensure that Air Jamaica continues 'soaring to new heights'.